By Rogerio Jelmayer

SAO PAULO--Brazil's main consumer confidence index rose for the second consecutive month in July, due to signs of slowing inflation and the positive effects of the World Cup, the Getulio Vargas Foundation, or FGV, said Friday.

FGV said its consumer confidence index for July was 106.9 points, up from 103.8 in June.

"The increase in consumer confidence is good news, but part of this increase could be attributed to the positive atmosphere created during the World Cup," said Viviane Seda, the coordinator of the index for the foundation. The World Cup took place in Brazil between June 12 and July 13.

The index has a 1-to-200 point range, with 100 considered an indicator of neutral sentiment.

The improvement of consumer confidence came as inflation showed signs of slowing. Consumer prices eased through mid-July compared with the previous month, as transportation prices fell. Brazil's mid-month consumer-price index, the IPCA-15, rose 0.17%, compared with a 0.47% climb in the month through mid-June, according to the Brazilian Geographic and Statistics Institute, or IBGE.

Ms. Seda said, however, that the increase in consumer confidence wasn't enough to show a change in a negative trend that started in November, as the country's economy performs poorly.

After an economic expansion of 2.5% in 2013, Brazil's economy is expected to expand less than 1% this year, a rate that economists consider too low for a developing nation.

The consumer confidence index polls 2,000 families in Brazil's seven largest cities. It measures the willingness of families to make purchases of various types of consumer goods and gauges expectations about employment, income and economic opportunities.

Write to Rogerio Jelmayer at rogerio.jelmayer@wsj.com

(END) Dow Jones Newswires

July 25, 2014 08:18 ET (12:18 GMT)

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